The trust currently has reached a market value of $1.8 billion dollars, causing some high-profile investors to raise the alarm bell.

Controversial investor Andrew Left, who is famous for predicting when shares in overvalued companies will take a fall, has said this valuation is “completely ridiculous” and is warning against the structure of the fund, though not necessarily Bitcoin itself.

The trust is run by Grayscale Investments, an investment firm that focuses specifically on digital currencies, and is designed to track the price of Bitcoin. The actual book value of the investment vehicle is around $820 million, based on Bitcoin’s price pushing past $4,700 and the fund holding 174,174 Bitcoins. You therefore have a situation where the market value of the fund is double that of the underlying asset.

One of the fund’s biggest attractions is the ability to trade in the price of Bitcoin, without going through the hassle of actually buying it directly. This is another red-flag for Left, who points out:

“[Grayscale doesn’t] even have insurance for the Bitcoin that they are custodians of.”

The Bitcoin Investment Trust is up by 726% this year on the back of Bitcoin’s record-breaking price increase. Bitcoin’s price only increased by 400% in comparison. The high premium could be a problem for new investors.

The fund is the first of its kind and that plays a big factor in it’s over inflated valuation. However, the cryptocurrency market is evolving fast. Other, similar funds will undoubtedly enter the market, which will put a lot of downward pressure on the valuation of the Bitcoin Investment Trust.